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Clean, green energy solutions come in many forms and – most notably solar, wind and hydro power. But savvy investors know that one of the cheapest, cleanest, and most energy efficient long-term solution to CO2 emissions-free energy source for the planet is actually nuclear.
This is where companies like BC-based
Fission Uranium Corp. (FCU) (
TSX.FCU,
OTCMKTS: FCUUF,
Forum) are stepping up to the plate. And for investors – both retail, institutional, and private equity – the sky’s the limit for this renewable energy resource.
Fission Uranium Corp owns a 100-percent interest in the high-grade and near-surface Triple R uranium deposit, located on the southwestern edge of Canada's prolific Athabasca Basin.
On February 1st, Fission announced that core drilling has now commenced at its Patterson Lake South (PLS) project, which is host to the large, high-grade, and near-surface Triple R deposit.
The fully funded, 43-hole program will focus on increasing the Indicated classified resource of the Triple R deposit's R780E zone, and also upgrading to Indicated the large R840W zone, approximately 500 metres west of the deposit.
In this informative and intriguing investor video podcast, Dave Jackson of Stockhouse Media was joined by Ross McElroy, CEO of Fission Uranium.
TRANSCRIPT BELOW:
SH: To start off with, can you tell us a little bit about yourself and the history of the company?
RM:Well my background, I'm a geologist I've been working in the resource sector for 35 years now, I guess I'd started in the mid-1980s and actually started in the uranium business you know, working in the Athabasca basin for Cameco and so a long history there and really that's what Fission Uranium is all about. It's a uranium development company now we've moved from an explorative developer, but always focused on the Athabasca basin.
SH: Can you update our investor audience and your Fission shareholders on all the new company developments, especially in the wake of COVID-19?
RM:Right. So you know, I guess yeah, COVID 19 has presented obviously some challenges to being able to operate. However we have successfully completed a drill program this past winter with a lot of protocols in place on the safety front. So I'd say works a little slower. We're very careful with what we do. We were able to successfully complete the program. So from that aspect, we know we can work within that environment, but it certainly does take a lot of extra monitoring and safety precautions, but it can be done.
SH: The company recently announced results from the first of its 2021 drill programs. What are some of the takeaways for investors here?
RM:Sure. Wellthe first phase of drilling, which we completed over the winter months was 20 holes focused on the main, R780 East zone. So that's the main part of the Triple R deposit. That's where all the economic studies have been done so far. That's what we've completed the pre-feasibility back in 2019 on, but the Eastern side of that zone is not as well defined to say that the Western part, soyou don't do economics on the part you don't have enough information on. So really those 20 holes were designed to bring a portion of the 780 zone up to the indicated category that we can now bring into the mine plan. We're still waiting on assays, of course. And that'll also then involve a little bit of remodeling of the resource, but I'd say we were very successful on every metric. We got better results than we were expecting. So I think we'll wait and see how the assays pan out, but I'm pretty happy with the results we got.
SH: Ross, can you give us a general update on the uranium sector and why we are seeing increased valuations throughout the space?
RM: W
ell I think it really has to do with the push right now for clean, green energy. You know, that nuclear has always played that role I think more and more now with the recognition that climate change is real, that countries have to make some substantial adjustments. Nuclear just keeps being pushed to the forefront of that. So I think partlywith the results of the voting in the US last year and then the government, that's more in tune with global climate change. I think that that's also when you notice that, you know, a spike up in the interest in the nuclear sector. So we think it's certainly a major part of the, of the mix going forward. It's not the only part, but it certainly is the only real alternative to fossil fuels on base load energy. So I think that that was really what the most recent push has been.
SH: With the ratification of the Paris Climate Agreement, there’s a renewed interest of multiple governments in green energy solutions visa vis nuclear. How do companies like Fission help meet these stringent emissions targets?
RM:So, I think that nuclear is certainly part of clean green energy, but I think we also have an advantage in the Athabaskan basin because you have the world's highest grade uranium deposits, and they are small footprint type things. So you're on your environmental impact of mine development, right there is actually a lot smaller since some of the bigger operations that you would have in Africa to get the same amount of uranium out. So, I think that overall just seeing that Canada is a first world country, a major supplier of uranium to the world. The smallest impact, I would say for mining just on an environmental footprint and being able to be a significant part of the mix, I guess that's really where we fit in.
SH: You’ve said that “Fission may possess one of the best inferred and indicated, highest-grade and largest near-surface uranium deposits in the world.” Can you expand on the significance of this for our investor audience?
RM:Yeah. I mean, the Athabasca basin is famous for having high grade deposits and large ones. You know, the last probably 60 years or 70 years of mining in Saskatchewan has all been out of the Athabasca basin. And one of the things that makes our deposit unique though, is that we're a hundred percent in basement rock. In other words, you don't have the overlying sandstone on top that has been problematic and other technical challenges and expensive to actually build mines around. So we're more mining-competent basement rock. And the fact that we're near surface is really what makes the difference. So the closer a deposit is the surface, I would say you start eliminating a lot of technical risk in development. So, large is a pretty common feature in the Athabasca. High grade is also a common feature. Being near surface is not. And in-basement rock is really what makes us unique.
SH: You’ve said the company is transitioning to a development focus. Has this transition been completed? Can you unpack the benefits of it?
RM:Sure. Yeah. I mean, obviously we started off as an exploration company. We were looking for a deposit, we found one, we advanced it and in 2019 completed a pre-feasibility. So really the next stage is what do you do with this? We ultimately see that this is the deposit that can make production you know, in the future. So the company has to sort of become a developer and what a developer is, is bringing engineering skills into it, mine engineering you know, focused rather than just playing exploration and drilling targets and looking for another deposit. So it's kind of really a new, a new skill set that we wouldn't have had say a year ago. And that's necessary and we've got to get through the regulatory hurdles. So you just start building a different skillset into the company.
And I would say, yeah, we've accomplished most of the most of that towards you know, last fall I brought on a senior regulatory expert in Mark Wittrup. So he's leading our regulatory and permitting aspects, but, and then significantly brought on a Vice-President Project Development back in January, Gary Haywood, and Gary's a well-seasoned mine engineer. He's an ex-Cameco engineer. He was the general manager at McArthur River, the world's largest high grade uranium mining operation and that’s in the Athabaskan basin as well. So all the relevant experience. And so I think that we've got the key parts of the, of the new team in place, the new management. So I think we're, you know,we're good to go forward. We're very well capitalized as well.
SH: For company shareholders and potential investors, what kind of future development can we expect at your PLS project?
RM:Well, the next phase for us is to go through I guess, a feasibility study’s, the next major milestone to complete. So, as I mentioned, pre-feasibility was completed in 2019. We understand this now to be an underground mining operation. So the feasibility work will begin this year likely starting in June. And you knowour mine development promotes a decline access. So, part of the initial work on the feasibility will be understanding the geotechnical data of driving a decline through the overburden into the basement rock. So that's probably the first bit of work, but feasibility will take us 12 months to 18 months to complete. And really that's the final economic milestone that we need to meet. Working in parallel there are of course all the regulatory and permitting issues. And so we enter now a phase called environmental assessment, the EA and everything's kind of wrapped in, it's a big umbrella phase, but it basically takes through the economic study and all the environmental, the social governance, the local and the rights holders and stakeholders’ agreements. Starts putting everything all together and that's all a necessary part going forward.
So it's a pretty exciting you know, phase for the company to be in. And that's really where we begin this year. And that'll take us through the next several years.
SH: I have to mention your stock has had a very nice bump over the last year…nearly tripling in value. What can you tell our investor audience regarding the current valuation of your stock and why you think it’s still a good buy right now?
RM:Oh, it certainly is. You know, I'd say that investors would notice that the whole uranium sector has had a real uptick, you know, so I think that people are recognizing that having uranium in your portfolio is probably a pretty clever thing. And we've been a part of that upswing in there. But I think the fact that we're a much more focused company now that we are in development stage, you know, there's very few companies that have development stage projects with the ability to be a, say a producing asset by, towards the end of the decade, that's sort of where we sit right now. I think that even though if we compare us on a valuation per peers in the you know, in their immediate geographic section we still have some catch-up work to do on a per pound basis.
Now, when we look at other peers that, that are getting probably double the valuation of their uranium per pound, there's really no reason for it. We just have a little bit of catch-up work to do. So let's say there are some immediate opportunities there for improvement in the share price, even just the balance owed on a, on a per pound basis. But I think as the overall sector, you know, continues to improve, and we think that will, and, and we keep you know, executing and meeting our milestones. I think that there's some great valuation, you know, increases in the stock.
SH: Can you discuss the long-term strategy for the company moving through 2021 and beyond, and what retail and institutional investors should be looking out for?
RM:
As a development story, really the goal is to move this project towards the end point, which is to be licensed as a producer. You know, we obviously need improvement in the uranium sector. We need the price of the commodity to improve substantially. This is true for any developer. You know, anybody that's switching to go into production is going to have to recognize or realize strengthened uranium markets. But, you know, I'd say that our plan is to continue to, to go forward as a developer. And you know, I think we're meeting all of our targets.
SH: Now, you just briefly mentioned the addition of Mark Wittrup to the team. Can you go one step further and tell our audience about other members of your corporate management and board teams, along with the experience they bring to the uranium space?
RM:Sure. I'll just touch on Mark, just for a minute as you’ve just mentioned. Mark's been working for us as a consultant for probably the last five or six years. So he was one of the QP's on our 43-101 on our pre-feasibility study. He's been involved with it, but he's just taking more of a lead role on the permitting and regulatory. And, you know, he's recognized as one of the gurus in the business, in that area. So I think we're in great hands. Bringing Gary Haywood on as the mine engineer and the lead for the feasibility study as VP Project Development is a huge, a huge boost to us. We have a Board that's you know, including two directors from CGN Mining. CGN are one of the Chinese state-owned utilities a huge, huge, huge utility company, and ultimately a major end-user for nuclear fuel.
So, you know, China is the fastest growth country that are the biggest contributor to nuclear power generation in the world. They are the growth story that most people know. Having Directors that are involved with them, is a key part. Plus other members on the Board are, you know, experts in capital markets and, and even some past uranium mining analysts. So I think we have a very well-rounded Board, great management team, all the skill sets needed to move the company forward.
SH: And finally, Ross, if there’s anything I’ve overlooked please feel free to elaborate.
RM:Just one, investors need to keep their eye on the ball in the uranium sector. You know, I think it really is an important place to consider for your investment portfolio. And you know, when you look at it, you'll want to see which companies have the assets and the goods that have the potential to be part of the mix and are great growth in value stories. And I think that Fission is certainly probably one of the top contenders in there. So you know, I just think that that would be the final message I want people to continue to look at.
For regular updates, visit
fissionuranium.com.
FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.